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Fiat
has responded swiftly to deny this morning's newspaper
reports that a proposal has been drafted for a potential
merger between the Italian car maker and French group PSA
Peugeot-Citroën although the denial in the statement wasn't
overly emphatic. Speculation of a merger with PSA was
revived this morning in Il Sole 24 Ore newspaper and
it immediately sent Fiat shares up in early trading.
Fiat
was swift to rebut the claims, in a statement issued this
morning in Turin it said: "In relation to comments in
today’s press, Fiat wishes to clarify that, except as
announced on January 20th, no proposal for a merger with
another automotive group is currently under consideration by
the Board of Directors." However the press release went on
to add that: "It is a known fact that – as is true for other
groups in the sector – Fiat frequently examines
opportunities for agreements of various types which would
offer it operational synergies and access to new markets,"
comments that hardly served to damped speculation, and at
11.30 am Fiat's shares were up 3.58 percent at 4.485 euro on
the Milan bourse.
The report
this morning in Il Sole 24 Ore claimed that a merger
proposal has been drawn up by Italian investment bank
Mediobanca and a strategic consultant. Mediobanca has a
very close relationship with the Fiat Group and is a
minor shareholder. The newspaper goes on to claim that
Fiat CEO Sergio Marchionne is now considering the merger
proposal and whether or not to present it to the Fiat
board. The newspaper report added that the production
facility structure in Italy would be retained,
safeguarding employment, but PSA would sustain the
employment costs and in exchange the new entity would be
headquartered in Paris. Marchionne would become the CEO
of the new group.
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